The California way

January 18, 2013

They said it could not be done—that California’s fiscal problems were so immense, so mind-boggling, that no one in his right mind dare even take it on.

Then again, few people have ever said that Gov. Jerry Brown was ever in his right mind, and that goes for his supporters as well as his critics.

Yet a week ago, the former Oakland mayor unveiled California’s first balanced budget in years, along with projected future surpluses, thanks mostly to previous grueling program cuts, and voters who in November approved his $5.6 billion annual tax-hike measure, Proposition 30.

(If that sounds like familiar fiscal responsibility, it’s because he achieved similar results in Oakland with the help of an unknown finance director named Marianna Marysheva-Martinez.)

Let’s all face it: California is its own separate country with its own separate problems.

Thus when the governor declared a deficit-free $97.7 billion general fund spending plan, it just about knocked us over with a feather.

It wasn’t just Brown who championed the numbers. Respected legislative analyst Mac Taylor also declared the budget “roughly in balance,” although he noted there are a lot of land mines ahead.

Many of the dangers ahead are in federal hands. Congress is under fearsome pressure to raise the national debt ceiling, and yadda-yadda-yadda. That’s way past Sacramento’s control, and another issue altogether.

For Californians, though, a small celebration seems in order, particularly for the state’s schools, which are the beneficiary of a bit of sleight of hand.

Brown’s decision was to divert into K-12 schools and community colleges all of the money from Proposition 39—the ballot measure that closes corporate loopholes and requires $500 million to be spent annually on energy efficiency programs.

Schools and community colleges will get $56.2 billion in 2013-14, which is $2.7 billion more than last year. That total is boosted by counting in the general fund Proposition 39 money, which was supposed to go exclusively for energy efficiency programs in schools under Brown’s budget.

The Proposition 39 money is on top of the voter-approved $5.6 billion annual tax-hike measure, Proposition 30.

Balancing the budget, Brown said in a televised interview, involved Draconian cuts, to be sure, but it also had to be coupled with increased revenue.

He did it by asking for higher tax revenues from the new voter-approved taxes; more savings from dissolving redevelopment agencies and cap and trade auction sales; health taxes and fees; and lower repayments of special fund loans.

There are many lessons to be learned from California’s example—all over the country and state—but they are particularly relevant in Mammoth, which almost fell into the abyss of municipal bankruptcy before pulling back with a $29.5 million legal settlement, to be paid over 23 years at an interest rate of 5.14 percent.

Mammoth can lick the revenue problem by adopting the Business Improvement District proposals floated by Tourism Director John Urdi. It already has imposed harsh fiscal constraints across the board.

It’s almost as if Marysheva-Martinez and Town Manager Dave Wilbrecht ask, on every decision, “What would Jerry do?”

If they answer correctly, Mammoth can achieve what the state achieved: creating the beginning steps in putting our fiscal house in order.They said it could not be done—that California’s fiscal problems were so immense, so mind-boggling, that no one in his right mind dare even take it on.

Then again, few people have ever said that Gov. Jerry Brown was ever in his right mind, and that goes for his supporters as well as his critics.

Yet a week ago, the former Oakland mayor unveiled California’s first balanced budget in years, along with projected future surpluses, thanks mostly to previous grueling program cuts, and voters who in November approved his $5.6 billion annual tax-hike measure, Proposition 30.

(If that sounds like familiar fiscal responsibility, it’s because he achieved similar results in Oakland with the help of an unknown finance director named Marianna Marysheva-Martinez.)

Let’s all face it: California is its own separate country with its own separate problems.

Thus when the governor declared a deficit-free $97.7 billion general fund spending plan, it just about knocked us over with a feather.

It wasn’t just Brown who championed the numbers. Respected legislative analyst Mac Taylor also declared the budget “roughly in balance,” although he noted there are a lot of land mines ahead.

Many of the dangers ahead are in federal hands. Congress is under fearsome pressure to raise the national debt ceiling, and yadda-yadda-yadda. That’s way past Sacramento’s control, and another issue altogether.

For Californians, though, a small celebration seems in order, particularly for the state’s schools, which are the beneficiary of a bit of sleight of hand.

Brown’s decision was to divert into K-12 schools and community colleges all of the money from Proposition 39—the ballot measure that closes corporate loopholes and requires $500 million to be spent annually on energy efficiency programs.

Schools and community colleges will get $56.2 billion in 2013-14, which is $2.7 billion more than last year. That total is boosted by counting in the general fund Proposition 39 money, which was supposed to go exclusively for energy efficiency programs in schools under Brown’s budget.

The Proposition 39 money is on top of the voter-approved $5.6 billion annual tax-hike measure, Proposition 30.

Balancing the budget, Brown said in a televised interview, involved Draconian cuts, to be sure, but it also had to be coupled with increased revenue.

He did it by asking for higher tax revenues from the new voter-approved taxes; more savings from dissolving redevelopment agencies and cap and trade auction sales; health taxes and fees; and lower repayments of special fund loans.

There are many lessons to be learned from California’s example—all over the country and state—but they are particularly relevant in Mammoth, which almost fell into the abyss of municipal bankruptcy before pulling back with a $29.5 million legal settlement, to be paid over 23 years at an interest rate of 5.14 percent.

Mammoth can lick the revenue problem by adopting the Business Improvement District proposals floated by Tourism Director John Urdi. It already has imposed harsh fiscal constraints across the board.

It’s almost as if Marysheva-Martinez and Town Manager Dave Wilbrecht ask, on every decision, “What would Jerry do?”

If they answer correctly, Mammoth can achieve what the state achieved: creating the beginning steps in putting our fiscal house in order.